Travel Insurance only willing to pay my portion of a villa refund

blindman

Insurers are (as usual) wanting their cake and eating it.
Insurance is about claiming for monetary LOSS.
If, I as a doting Father, I pay for a Villa and flights outright as a "gift" and let my guests come free then if that holiday goes down the pan due to Covid (with no chance of recovery)  then the ONLY person who has lost money is ME, so I should be able to claim the full amount I paid out.
This scenario will not happen very often , but when it does, as is the OP's case, Insurers need to be taken to the Ombudsman if they do not pay out.